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Strategies & Market Trends : REITS - Buying 1 - 2 weeks before going ex-dividend -- Ignore unavailable to you. Want to Upgrade?

To: Grommit who wrote (2231)	1/10/2002 10:39:14 AM
From: Richard Barron	Read Replies (3) \| Respond to of 2561

Grommit, I don't have any FFO projections for PPS. This quarter should be down to .81 FFO from .93 since they projected 3.46-3.48 for the year and reported 2.66 for the 9 months. Outlook The estimates presented below are forward-looking and are based on current expectations. As a result of the current economic environment, the company believes its financial results for the remainder of 2001 will be less than it previously anticipated. The company now expects FFO per share for 2001 to be between $3.46 and $3.48. Earnings per share is expected to be between $2.35 and $2.37. Payout Ratio ..... 3rd 2001 3rd 2000 ytd-2001 ytd-2000 Payout ratio FFO .. 89.7% .. 80.9% .. 88.0% .. 78.6% Payout ratio CAD . 101.3% . 91.6% .. 99.2% .. 86.4% I think AFFO is more important than FFO for dividend security. AFFO is the cash flow needed to fund capital improvements. Post reports CAD (Cash Available for Distributions) and in the 3rd quarter it dropped from .83 in 2000 to .77 in 2001. This is .01 less than the current dividend. Since many of the other apartment REITs are expecting lower FFO growth, the environment may be getting tougher. I think Post is a pretty good company, but if they do cut the dividend, look for a quick 20-25% drop, which most long term investors don't want to see. The chances of a dividend cut seem less than 50/50 to me, but I am aware of only 5 or 10 REITs out of 180 are paying out 100% of the AFFO, so why invest in one of the poorer performing REITs. Richard